High Court Of Calcutta
A. K. GANGULY, PRANAB KUMAR CHATTOPADHYAY
NATIONAL PROJECT CONSTRUCTION CORPORATION LTD - Appellant
Versus
AROMA UNIVERSAL - Respondent
A. P. O. 842 Of 1998
Decided On : 02/19/2000
ARBITRATION - JURISDICTION - EXCEEDING JURISDICTION - LIMITATION - AWARD - NON-SPEAKING AWARD - JUDICIAL REVIEW - SCOPE.
Fact of the Case:
Appellant challenged an arbitration award on grounds of delay in preferring the claim and that the arbitrator exceeded jurisdiction and made a nullity award by disregarding the terms of the contract.
Finding of the Court:
The court held that the appellant could not raise the point of limitation for the first time in the appeal, and that the arbitrator did not exceed his jurisdiction or act without jurisdiction.
Issues: 1. Whether the arbitrator exceeded his jurisdiction by disregarding the terms of the contract? 2. Whether the claim was barred by limitation?
Ratio Decidendi: 1. The court held that the arbitrator did not exceed his jurisdiction by disregarding the terms of the contract because the arbitration clause was sufficiently wide to cover the disputes and differences of the parties, and the arbitrator was empowered to determine the issue of whether "labour payment" was included or excluded in the contract. 2. The court held that the appellant could not raise the point of limitation for the first time in the appeal, and that the determination of the starting point of limitation was a question of fact or a mixed question of fact and law that could not be argued for the first time before the court hearing an appeal in connection with a non-speaking award.
Final Decision: The court dismissed the appeal and upheld the arbitration award, except for a modification of the interest rate.
( 1 ) THIS appeal is directed against the judgment and order dated 13th May, 1998 passed by the learned single judge while deciding the application filed by the appellant hereinunder sections 30 and 33 of the Arbitration Act challenging the award made and published by the learned Arbitrator on 13th May, 1997.
( 2 ) LEARNED single Judge dismissed the application for setting aside the award filed by the appellant herein and passed a decree in terms of the award with an amendment that interest should be charged at the rate of 12% instead of 18% as was directed by the learned Arbitrator.
( 3 ) THE appellant has challenged the said judgment and order passed by the learned single Judge in the present appeal on the grounds that there was delay in preferring the claim and accordingly, Arbitrator should have rejected the claim on the ground of limitation and secondly, the Arbitrator exceeded his jurisdiction and made an award which is a nullity. According to the appellant, arbitrator had decided the disputes and awarded the claims without considering the terms of the contract properly. Learned counsel of the appellant submitted that by disregarding the terms of contract, Arbitrator committed jurisdictional error and the learned Arbitrator thereby travelled beyond the scope of the reference.
( 4 ) LEARNED counsel appearing on behalf of the appellant submitted that the parties are bound by the express terms of the contract. According to the counsel of the appellant, a number of items were not payable under the contract by the appellant but the claims have been made and was also allowed by the learned Arbitrator without considering the relevant terms of the contract and the learned Advocate of the appellant submitted that the quantification of the claims have been made by the claimant not in terms of the contract and this is not permissible.
( 5 ) THE award passed by the Arbitrator is, admittedly, a non-speaking lump sum award. Mr. Dipak Basu, learned senior counsel, appearing on behalf of the appellant submitted that the arbitrator cannot go beyond the terms of the contract but while deciding this specific issue, learned Arbitrator has done that. While answering the additional issue No. 1, Arbitrator held that the parties are bound by the terms and conditions of the contract as far as practicable. Mr. Basu submitted that the Arbitrator acted erroneously while answering the said additional issue No. 1.
( 6 ) MR. BASU referred to and relied upon the following judgments in support of the contention that the Arbitrator cannot go beyond the terms of the contract. 1. ASSOCIATED Engineering Co. v. Government of Andhra Pradesh and Anr. AIR 1992 SC 232 Paragraph 26 and 27 at Page 2392. STEEL Authority of India Ltd. v. J. C. Budharaja (1999) 8 SCC 1223. RAJASTHAN State Mines and Minerals Ltd. v. Eastern Engineering Enterprises and Anr. (1999) 9 SCC 283
( 7 ) MR. Basu referred to various documents and letters exchanged between the parties and submitted that the learned Arbitrator failed to answer the issue properly and he erroneously passed the award allowing the claims of the claimant. According to Mr. Basu, the learned Arbitrator has exceeded his jurisdiction which according to him is apparent on the face of the record.
( 8 ) MR. Basu further submitted that the Arbitrator while deciding the disputes disregarded the terms of the contract and thereby committed jurisdictional error as the Arbitrator travelled beyond the scope of the reference. Mr. Basu also submitted that the quantification of the claims have been made by the claimant according to the labour payments which is not permissible under the contract. Accordingly, Mr. Basu submitted that the award passed by the learned Arbitrator is liable to be set aside on the ground of jurisdictional error as the Arbitrator has exceeded his jurisdiction.
( 9 ) MR. Dutt, learned senior counsel, appearing on behalf of the respondent submitted that the Arbitration Clause men
REFERRED TO : Associated Engineering Co. v. Government of Andhra Pradesh and Anr.
Rajasthan State Mines and Minerals Ltd. v. Eastern Engineering Enterprises and Anr.
B.V.Radhakrishnan, In the Matter of
M.L.Dalmia and Co. v. Union of India
Hindustan Construction Co. Ltd. v. State of JandK
Wild Life Institute of India, Dehradun v. Vijay Kumar Garg
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